Sparbanken Skane

The stable outlook on Sparbanken Skåne reflects our expectation that the bank will continue its relationship with Swedbank and keep its leading position in its local market. We believe Sparbanken Skåne will maintain a sound financial position underpinned by robust capitalization, despite possible pressure on asset quality and earnings over the next two years. We anticipate Sparbanken Skåne will continue building and maintaining a considerable ALAC buffer in the coming years as it fulfils its minimum requirements for own funds and eligible liabilities (MREL), and that the ALAC buffer will durably exceed our adjusted threshold of 4% of risk-weighted assets (RWAs). We could take a negative rating action if we observed changes in the bank's risk appetite or operating conditions

...Sparbanken Sksne's partnership with Swedbank will continue to support its strong standing in the home region. We expect Sparbanken Sksne to maintain its leading position in the Sksne region in Southern Sweden. The bank has actively lent to the area for decades but holds only a modest market share of 1% nationally in Sweden. Due to historical ties and the bank's limited size, Swedbank provides support by equipping the bank with products, IT, and short-term liquidity, if needed. We believe this long-term partnership will continue as it supports overall revenue capacity and efficiency gains. Loan book concentrations could add to asset quality pressure as economic conditions are set to deteriorate. We expect rising interest rates and broad-based cost inflation will pressure the financial capacity of households and corporates in Sweden. Sparbanken Sksne's regional concentrations could, in this context, increase downside pressure on its loan...

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